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News Topical, Digital Desk : Market regulator SEBI chairperson Tuhin Kant Pandey told CNBC-TV18 that the regulator will soon issue a consultation paper on long-term tenure for derivatives. He said that it will focus on weekly expiry and transparency will be maintained in the entire process. SEBI may bring a consultation paper on weekly expiry next month. This will include a roadmap (Glide Path) to gradually move from weekly expiry to monthly expiry. This step of SEBI is considered important in the direction of reducing market volatility and making trading stable.
What is the current system In the current system, indexes like Nifty and Bank Nifty have weekly expiry. SEBI is now considering bringing Glide Path, under which there will be a gradual shift towards monthly expiry. Its objective is to reduce market volatility and make trading stable. High volatility will be reduced in the short term, which can provide relief to retail investors.
Impact on option traders: Traders who make profits from weekly options will have to make a new strategy.
Benefit to long-term investors: A stable environment will increase the confidence of big investors.
Impact on the stock market In the short term, volumes in the F&O segment may decrease as weekly expiry activity is high. In the long term, the market structure will strengthen and the cash market may stabilize. Its maximum impact will be seen on banking and index trades.
What did the global brokerage house say Global brokerage house Jefferies has said that there is a buzz in the market that SEBI may change the weekly expiry to fortnightly or monthly expiry. Jefferies warned that if such a change happens, it could directly impact the earnings of companies like BSE and Nuvama. As a result, a major decline in EPS is possible in FY27.
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